Tuesday, May 10, 2016

Meralco asked to fix power dispute

The Energy Department ordered
Millennium Energy Inc. and Manila Electric Co. to make 100 megawatts of power
supply from the Navotas diesel-fired power plant available when required by the
grid.

Energy Undersecretary Mylene
Capongcol told reporters Energy Secretary Zenaida Monsada asked Millennium and
Meralco in a letter to ensure the availability of power when needed by the
power grid.

“Secretary Monsada sent a letter to
them last Friday,” Capongcol said.n “The plant is on shutdown mode but it’s a
fast start so it could immediately run if it is required to do so,” the
official said.

Monsada earlier said she would sit
down with Meralco and Millennium to resolve their dispute and allow the
generation of 100 megawatts of capacity from the Navotas plant.

Monsada also wanted the Navotas
diesel plant to provide additional capacity to during the election period.

“We will talk with them. The
Millennium capacity will bring in additional [supply] comfort if it can be
resolved,” Monsada said.

Meralco president Oscar Reyes said
the company wanted to “find something that works for both parties.”

“We can sit down directly with them
[Millennium]... We’ll try to see if we can enter into some kind of viable
arrangement with Millennium,” he said.

ERC chairman Jose Vicente Salazar said
Millennium’s dispute with Meralco revolved around the distribution wheeling
services agreement on the diesel plant at the Navotas Fish Port Complex in
Navotas City.

“The commission met with Millennium
because they have a problem with Meralco, specifically their DWSA with
Meralco,” Salazar told reporters.

Salazar said Millennium decided to
stop supplying its capacity to the Wholesale Electricity Spot Market after
incurring losses due to the exorbitant wheeling charges being charged by
Meralco.

WESM, the trading floor of
electricity, is operated by Philippine Electricity Market Corp.

“Millennium is embedded to Meralco
so it is being charged the wheeling charges... This is one thing that is
crucial with the agreement. Millennium will have to pay Meralco despite the
fact that it is not earning from the market. It is like the highway that even
if you don’t use it you pay for it and it is based on the capacity that you can
actually offer to the market,” Salazar said.

Millennium has decided to rescind
its contract with Meralco. Millennium notified PEMC that it would cease its
membership in the WESM effective April 1.

“Millennium decided to rescind its
contract [with Meralco]. It did not want to pay anymore saying that the
contract was unreasonable,” the Salazar said.

He said Millennium’s output could
have added to the grid, especially during the dry months when supply is tight
due to low generation from hydro power plants.